Home Mortgage Refinancing Guide

The kitchen sink is what the Federal Government chucked at the mortgage crisis last week when they took over Freddie Mac and Fannie Mae. When the Feds take over private companies it’s a really big deal and is the one thing that could pull the economy out if its ongoing slump.

Here are several things you can expect to happen over the coming months following the government takeover of Fannie Mae and Freddie Mac.

The most notable impact is the recent drop in mortgage rates. You can expect rates to stay just over five percent for a thirty year fixed rate loan. This is due to the government backing of mortgage bonds which significantly lowers the risk to investors. Because mortgage backed securities have higher yields than treasury bonds you can expect investors to move money which will drive mortgage rates further down.

Falling mortgage rates and the new government backed security of mortgage bonds should also bring foreign investors back to the US bond market, specifically new government insured mortgage bonds. This will have a side benefit of slowing inflation and boosting our faltering economy.

There is one unfortunate aspect of the mortgage industry that the government bailout will not change and that is lender underwriting. Qualifying for a mortgage loan will continue to be tight; even more difficult for homeowners in need of Jumbo mortgage loans. Jumbo loans are not purchased by Freddie Mac or Fannie Mae and have not been positively affected by the government bailout.

There is some good news for jumbo mortgage holders. Mortgage lenders know there is money to be made in this market and are currently offering competitive rates for loans greater than $417,000. The bad news is that tight underwriting standards aren’t expected to change anytime in the immediate future.

If you are a homeowner with good credit looking to refinance your home mortgage there is no better time than the present. Mortgage rates are at all time lows and lenders are desperate for homeowners with a solid financial history. You can learn more about refinancing your mortgage without overpaying and avoiding junk fees by registering for the free mortgage videos available on this website.

Current mortgage rates are declining and are expected to fall further because of the Government takeover of Freddie Mac and Fannie Mae. Mortgage Rates have been rising steadily due to the recent credit crisis in the United States.

Today on FOX News Warren Buffet stated that that the current mortgage rates are based on a phenomenon known as credit spread, and that “spread” is the reason that mortgage rates have been on the rise. The spread is the result of a lack of investor confidence in mortgage backed securities. The debt carried by Fannie Mae and Freddie Mac was headed for a crisis had the Federal Government not stepped in by taking over.

After the Federal Government took over, current mortgage rates are now more like Treasury bonds. These bonds carry very low risk and have low yields and interest rates. When the Government took over Fannie Mae and Freddie Mac mortgage loans became less risky overnight; as a result mortgage rates are declining.

Now is a great time to refinance your higher interest rate mortgage or even consolidate your more expensive home equity line to lock in this lower rate. Despite falling mortgage rates there are a number of reasons that people overpay when refinancing. The least known but most common is Yield Spread Premium. This markup of your mortgage interest rate for a commission by the broker is responsible for American homeowners overpaying nearly sixteen billion dollars this year alone according to the HUD Secretary.

Homeowners who learn how to recognize this markup of their mortgage interest rate are able to take advantage of wholesale mortgage rates and save thousands of dollars ever year. If you’d like to learn more about refinancing your mortgage with a wholesale rate while avoiding lender junk fees sign up for the free video guide available from this website.

Homeowners Rejoice! The Federal government bailout of Freddie Mac and Fannie Mae will result into lower mortgage rates and more credit available according to financial experts. Mortgage rates could fall by as much as one percent from the lofty 6.3% for a traditional 30 year fixed rate home loan.

On Sunday the Federal government took over Freddie Mac and Fannie Mae in a move that’s being heralded as a win for homeowners. According to research and consulting firm Wholesale Access the Government’s move will lower the cost of mortgages and make credit more accessible. If you have been wanting to refinance your higher interest rate mortgage loan now is your chance to grab a lower rate.